Enrolled SB 117: Requiring the Department of Revenue to set the minimum price for cigarettes for sale by wholesalers and retailers; and prohibiting a wholesaler or retailer from selling at wholesale or retail cigarettes at a lower price than the price set by the Department of Revenue.
00Enrolled SB 117 01 Requiring the Department of Revenue to set the minimum price for cigarettes for sale by 02 wholesalers and retailers; and prohibiting a wholesaler or retailer from selling at wholesale or 03 retail cigarettes at a lower price than the price set by the Department of Revenue. 04 _______________ 05 * Section 1. AS 43.50.710(a) is amended to read: 06 (a) A wholesaler or retailer may not, with intent to injure competitors or 07 destroy or substantially lessen competition, 08 (1) advertise, offer to sell, or sell, at retail or wholesale, cigarettes at 09 less than the minimum price determined by the department under 10 (A) AS 43.50.810(a) for a sale at wholesale; or 11 (B) AS 43.50.810(b) for a sale at retail [ACTUAL COST TO 12 THE WHOLESALER OR RETAILER]; or 13 (2) offer a rebate in price, give a rebate in price, offer a concession of
01 any kind, or give a concession of any kind or nature in connection with the sale of 02 cigarettes. 03 * Sec. 2. AS 43.50.710(b) is amended to read: 04 (b) A retailer may not induce or attempt to induce or procure or attempt to 05 procure 06 (1) the purchase of cigarettes at a price less than the wholesale 07 minimum price determined under AS 43.50.810(a) [ACTUAL COST TO A 08 WHOLESALER]; 09 (2) a rebate or concession of any kind or nature in connection with the 10 purchase of cigarettes. 11 * Sec. 3. AS 43.50.710(c) is amended to read: 12 (c) Evidence of advertisement, offering to sell, or sale of cigarettes by a 13 wholesaler or retailer at less than the applicable minimum price determined by the 14 department under AS 43.50.810 [ACTUAL COST], or evidence of an offer of a 15 rebate in the price, the giving of a rebate in price, offer of a concession, or the giving 16 of a concession of any kind or nature in connection with the sale of cigarettes, or the 17 inducing, attempt to induce, the procuring, or the attempt to procure the purchase of 18 cigarettes at a price less than the applicable minimum price determined by the 19 department under AS 43.50.810 [ACTUAL COST TO A WHOLESALER OR 20 RETAILER] is prima facie evidence of intent to injure competitors and to destroy or 21 substantially lessen competition. 22 * Sec. 4. AS 43.50.720 is amended to read: 23 Sec. 43.50.720. Sale at less than minimum price [COST]; sale with gift or 24 concession. In all advertisements, offers for sale, or sales involving two or more items 25 when at least one of the items is cigarettes at a combined price, and in all 26 advertisements, offers for sale, or sales involving the giving of any gift, concession, or 27 coupon of any kind in conjunction with the sale of cigarettes, the wholesaler's or 28 retailer's combined selling price may not be less than [BELOW] the applicable 29 minimum price determined by the department under AS 43.50.810 [ACTUAL 30 COST TO THE WHOLESALER OR THE ACTUAL COST TO THE RETAILER, 31 RESPECTIVELY,] of the total of all articles, products, commodities, gifts, and
01 concessions included in the transactions, except that, if any articles, products, 02 commodities, gifts, or concessions are not cigarettes, the price [ACTUAL COST] 03 shall be the applicable minimum price determined by the department under 04 AS 43.50.810 [DETERMINED AS PROVIDED UNDER AS 43.50.800]. 05 * Sec. 5. AS 43.50.740(c) is amended to read: 06 (c) A manufacturer whose product is sold in the state directly or through an 07 intermediary shall provide the department with a current price list for all brands of 08 cigarettes of the manufacturer and shall notify the department at least three [10] days 09 before a price change [INCREASE] takes effect. 10 * Sec. 6. AS 43.50.790(a) is amended to read: 11 (a) The department 12 (1) shall administer AS 43.50.710 - 43.50.849; 13 (2) may adopt regulations relating to the administration and 14 enforcement of AS 43.50.710 - 43.50.849; 15 (3) shall [MAY] determine the applicable minimum price for 16 [ACTUAL COST OF] cigarettes sold by [TO] a wholesaler or retailer as provided in 17 AS 43.50.810 [AS 43.50.800]; 18 (4) may, after reasonable notice and hearing, revoke or suspend a 19 license issued under AS 43.50.010 or 43.50.035 to a person who refuses or neglects to 20 comply with a provision of AS 43.50.710 - 43.50.849. 21 * Sec. 7. AS 43.50 is amended by adding a new section to read: 22 Sec. 43.50.810. Minimum prices for cigarette sales. (a) For the purposes of 23 AS 43.50.710 - 43.50.849, the department shall determine the minimum price for 24 which a wholesaler may advertise, offer to sell, or sell cigarettes at wholesale by 25 applying the following formula: 26 Wholesale Minimum Price = 1.02(M - D + T), 27 where M = the manufacturer's list price; 28 D = trade discounts; and 29 T = the full face value of all cigarette taxes. 30 (b) For the purposes of AS 43.50.710 - 43.50.849, the department shall 31 determine the minimum price for which a retailer or wholesaler may advertise, offer to
01 sell, or sell cigarettes at retail by multiplying by 1.04 the wholesale minimum price 02 determined under (a) of this section. 03 * Sec. 8. AS 43.50.730, 43.50.740(a), 43.50.760, 43.50.770, 43.50.800, and 43.50.849(4) 04 are repealed.